As discussed August 14, we are working with potential funder(s) to move on exploration at Hay Mountain and developing projects elsewhere that can be brought into production more quickly and less expensively than the massive copper targets that we believe are present at Hay Mountain. These other projects would be for precious metals and uranium, and a high demand, high price non-metallic product, under evaluation.  There are ten of these projects which are located in the desert areas of Arizona, Nevada and Utah.

Proposed new projects

We are working with potential funders on projects that are in the exploration stage that will allow us to develop these properties on a timeline that is more attractive to capital sources. These new properties have been in production, and put on care and maintenance due to economic conditions, chiefly lower metal prices and/ or technological issues.  Some of these targets have not been production for 73 years (closed by Federal government edict the War Production Board Limitation Order No. 208 in autumn 1942 also known as the Gold Closing Act),  and others for about 100 years because of the lowered price of precious metals and the lack of applicable technology in the ensuing 100 years.   The current potential of these properties has gone unrecognized by others. In the case of the uranium targets, the dramatic fall off of the price of uranium after three uranium boom and bust cycles, and lack of better applicable technology, for economic mining was missing.  We believe all of these properties identified by us in the last four months are potentially economic to mine (potential ore bodies) under current economics and with technological mining equipment we intend to use.  We believe joint venture capital partners are available to provide help with advanced exploration and construction financing, which will be relatively low.  However, with our S-1 funding available we can move forward immediately to start the process of ore definition on one or more of these targets and we believe we will develop and bring one or more of these projects into very profitable production within a year or two.  Such profitable production will in part be used to help fund the longer range exploration and development needs of Hay Mountain.

There are 10 new properties with primary targets that we are prioritizing for our work activities:  

The first of these would potentially contain two types of ore bodies – shallow open pit and shallow underground – both for a combination of gold and silver bearing rock.  There are no drill records of these mineral bodies but there are extensive underground data from past production that suggests average grades that would be profitable using current mining technology.  We have invoked known general mining and metallurgical costs using our projected mining and metallurgical equipment.

The open pit component suggests: time to get into production of 2 years though it could be less; net annual revenue of $223 million and a mine life that could exceed 10 years.  Drilling in untested areas could increase ore reserves.

The underground component would use appropriate bulk underground mining technology and feed the same mill that the open pit would use, thus saving costs.  The total net revenue would be in excess of $10 billion at approximate current prices with a mine life of 40 years if production were matched to that of the open pit.  In both types of mining we think there may be potential for significant additions to the mine reserves.  It should be noted that we are still working to secure these mineral targets.  Note that I used the term “mineral target” as there are no resources measured and defined by drilling and thus no Ore is present; that will be defined by an extensive but shallow (a few tens of feet to an estimated maximum of 400 feet) diamond core drilling program for both targets going through the usual steps required to define continuity, tonnage and grade and well as specific metallurgical characteristics.  The actual amount of economically minable mineralization (which is in fact Ore by definition) and could be more or less than those estimates cited above.  We are going through the steps to permit the mining of these features, the first of these steps we learned was positive, as of Thursday August 13 and thus we will continue in the process.

The next five targets have characteristics similar to those described for the first two targets.  These are:

1. The commodities which are primarily gold and silver.
2. They are underground/open pit mineral zones that were at one time producing mines that ceased production because of price and technological changes, compounded by government regulation that no longer exists (WWII Gold Closing Act L-208, 1942 to 194(6)).
3. New mining technology that Liberty Star believes will be applicable and drastically lower the cost of mining and metallurgy suggests that what are now shallow mineral zones can be measured by shallow drilling, and will become viable, shallow, low cost ore bodies. The general process is the same: drill, assay, test metallurgy, and continuity of mineralization to determine mineability.  Each target may turn out to have both an open pit and an underground component, which will be determined by the exploration and definition process.
4. These targets, like the primary targets are easily accessible with no known permitting challenges. They have been overlooked by others.

They will be pushed forward as quickly as possible and time to get into production will be in the same time frame – one to two years.  The size ranges are not as clearly known as the first two targets mentioned above, but appear to have significant size potential.

Uranium in Utah

The next two targets are located in western Utah and have been generated by a prospecting group: the Harrison Land Services LLC, also located in western Utah, in the uranium fields there.  The owner, an aggressive entrepreneur who is the third generation of uranium geologists and prospectors has identified, at our request, shallow uranium targets that have potential to be drilled out and mined by our selected equipment at a very low cost and shipped directly to an operating uranium mill.  We would take the two best targets, and perform the same process of drilling and measuring mineralization to see if we can turn the targets into viable ore bodies that can be put into production, perhaps very quickly – say in a year or less.  As we would be bringing the ore to a custom uranium mill for mineral recovery, no mill construction or permitting would be required.  The recovered product would be uranium with perhaps by product vanadium.

This agreement between the two companies, signed a few weeks ago, is open ended so if it works well we would aggressively move forward on other similar targets that we believe exist.  Harrison Land Services has suggested a non-metallic high value mined product that we believe may be a very significant profit center.  We will do further investigation to determine whether it is worth our while.  It should be very amenable to our mining approach, and could be mined at a very low cost, and as no processing is necessary, potentially produced at a very high profit margin.

Proposed changes to phase 1 exploration at Hay Mountain

Goal: Identify copper oxide and associated minerals at near surface at Hay Mountain

Purpose: to determine the feasibility of a shallow open pit copper heap leach, solvent extraction and electro winning operation and/or in-situ leach and  solvent extraction, electro winning process

Reason: timetable to mining operation much shorter than a deep sulfide open pit or underground mine at a substantially lower cost

Funding: given the current economic realities, potential investors have expressed interest in an operation that has a smaller price tag for Phase 1 and further development

New planned cost of phase 1: $x million

No geophysical surveys (ZTEM in our case) have the ability to identify oxidized sulfide minerals including copper minerals.  However, our veggie geochemistry results may be helpful in indicating shallow copper oxide minerals above copper sulfide bodies which are indicated in the anomaly area.   All porphyry copper deposits within more than a 100 mile radius of Hay Mountain, including those in Mexico, New Mexico and all of the Arizona porphyry copper province, have a copper oxide component, which had, currently has, or will have a copper leach, solvent extraction and electro winning component – most of which are highly profitable even at the current low price of copper.

Changes to the Phase 1 exploration plan of operation will include:

1. Additional geologic mapping
2. Additional veggie geochem sampling along the ZTEM helicopter flight line paths to enhance interpretation which will help in identifying copper oxide zones.
3. Shallow drilling.

This new approach has already been started.  We will report as further developments occur.

James A. Briscoe  CEO/Chief Geologist                 8/17/2015

RISK FACTORS FOR OUR COMPANY ARE SET OUT IN OUR 10-K AND OTHER PERIODIC FILINGS FILED WITH THE SEC ON EDGAR.